Friday, May 7, 2010

Metal stocks like Freeport McMoRan (NYSE:FCX) and Southern Copper (NYSE:SCCO) have been hit hard on concerns over the possibility of a slowdown in China, which has cuased the companies to fall by over eight and nine percent respectively in the last few days.

China is battling its own potential housing bubble problems, and have been raising interest rates and cutting back on allowing third homes for borrowers.

That has investors fearing the measures could cut back on the need of raw materials, which of course would hammer the metals companies which are so reliant on China.

Even it this doesn't result in a bubble, companies and investors will have to take into consideration the levels of demand for commodities won't continue on at this pace, even in China.